"Eighteen euro per meter for the fabric," replied the clerk in English. That's always a bad sign, when the Frenchman on the other end of your conversation replies to your French in English. This guy wasn't fooled. He figured straight off that I'm not of this city. I'm the Paris equivalent of a gringo. "Plus 50 euro per panel to make the curtains," he continued. I'm the Paris equivalent of a gringo, and I was being quoted, I realized, gringo pricing. I bought the fabric, because I was in a hurry and didn't have time to look further or to bargain harder. But 50 euro per panel for the couture? Yikes. I figured I'd take the fabric home and ask friends to recommend a more reasonably priced seamstress. Alas, it turns out, none of my friends knows a seamstress. Plus, Lief pointed out when he reviewed my purchase, I hadn't bought enough fabric anyway. So, this morning, back I went to Sacre-Coeur, resigned to the idea that I was going to have to pay handsomely for my simple little window sheers. Then, stepping out from the Metro, I looked up to see a sign that promised, in French, "Curtains In An Hour." To my delight, the young man inside this shop responded to my opening French in French. And he seemed interested in chatting. Where was I from originally, he wondered? Do I know Arizona? In fact, I replied, my husband hails from Phoenix. Ah, he exclaimed, my girlfriend lives in Sedona! All this chit-chat in French, my new friend politely indulging my slow and careful remarks. Finally, time to get to the point. The young man reviewed my measurements and assured me that, yes, he could carry out the work straightaway. Plus, he stocks the same fabric as I'd purchased elsewhere last weekend, so I could buy the additional I need from him. The moment of truth. "How much?" I asked. "Ten euro per meter for the fabric...and 9 euro per panel for the sewing." My fears were confirmed. I'd been a victim of gringo pricing in my original encounter. Of course, this wasn't the first time. For more than 25 years, I've been spending most of my time in places where I'm obviously the outsider. And I've learned that the secret to success anywhere is breaking through to the local market. Do this, and your entire experience of a place changes. Not only does your life become fuller, richer, and more interesting...but it becomes a whole lot cheaper, too. This month in Paris, carrying out our apartment makeover, I've been shopping for everything from paint to shower curtains, from trash cans to juice glasses, from curtain rods to kitchen rugs, and, as with the curtain fabric, I've been reminded that it pays, in every case, to be able to shop on the local market. A plastic kitchen trash can in one of Paris' grands magasins (big department stores) can cost 50 euro or more. The same-size bin bought at the out-of-the-way sundries shop we discovered by accident a few years ago costs 12 euro. A single juice glass can cost 4 or 5 euro in central Paris...or you can buy a set of three for 2.50 euro from the discount store in the 18th arrondissement we discovered the other day. It helps to speak the language. Though, in practice, being able to articulate what you want to say in the local lingo may not be enough. Alas, as my recent encounter reminded me, my Baltimore-accented French doesn't always cut it. Kathleen Peddicord Continue Reading:
As Kaitlin explained to our group Friday afternoon, she and her friends learned that you don’t have to spend a lot to enjoy a big experience in the City of Light. Sometimes, you don’t even have to spend a little. Some of the best experiences this city has to offer come absolutely free. For example, Kaitlin explained...
- One day every month and every Bastille Day, most all museums in Paris offer free admission. Every Wednesday, for example, La Maison Européenne de la Photographie (5-7 rue de Fourcy, 75004 Paris; tel. 01-44-78-75-00) and La Fondation Henri Cartier-Bresson (2 impasse Lebouis, 75014 Paris; tel. 01-56-80-27-00) offer free evening admission.
- Every Thursday, galleries in the 3rd, 7th, and 8th arrondissements offer vernissages--that is, free openings with wine. Often, you can often meet the artist or the gallery owner.
- Right now through the end of August, Paris Plage, the beach built from sand trucked to Paris and deposited along the bank of the Seine in the 4th arrondissement, offers free access to riverside fun, live music, games, even free water aerobics (not in the river but in the public swimming pool that’s part of the annual Paris Plage venue).
- You can take a free guided tour of the Fragonard Perfume Museum (Le Musee du Parfum), housed in a Napolean III townhouse.
- Galleries Lafayette, one of this city’s grands magasins, offers free fashion shows every Friday at 3 p.m.
- Several restaurants in the city provide complimentary plates of food when you can order cocktails. In the 11th arrondissement, La Cordonnerie (142 rue Saint-Denis, 75002 Paris; tel. 01-40-28-95-35) offers couscous with your drinks every Thursday and Saturday starting at 8.30 p.m. In the 10th arrondissement, the Tribal Café (3 cour des Petites-Ecuries, 75010 Paris; tel. 01-47-70-57- 08), one of the pioneers of this "formule," serves fried mussels every Wednesday and Thursday from 9 p.m. on, and couscous Friday and Saturday nights.
- Meantime, wineries around the city offer free tastings in the hopes that you will be tempted to buy bottles of your favorites to take home with you. The prestigious Caves Taillevent (199 rue du Faubourg Saint-Honoré, 75008 Paris; tel. 01-45-61- 14-09) gives tastings every Saturday from 10 a.m. to 2 p.m.; La Grande Epicerie du Bon Marché, (38 rue de Sèvres, 75007 Paris; tel. 01-44-39-81-00) does tastings Fridays and Saturdays from 11 a.m. to 7 p.m. and almost every day during the annual wine festivals; and Petits Bouchons (105 rue Cambronne, 75015 Paris; tel. 01-47-34-89-31) organizes tastings practically every weekend, often with the wine makers themselves.
Kathleen Peddicord P.S. What else this week?
- "France and the United States date to about the same time," began French friend and legal expert Jean Taquet in his address to our group assembled in the St. Petersbourg Hotel in Paris this week."The trouble in France was that, unlike in the United States, where the enemy of the Revolution wore red coats, the enemy of the French Revolution, the aristocracy, was unrecognizable on sight.
"Therefore, the French take it as part of the birthright of their Republic that no one and nothing can be taken on sight. Representations can be deceiving, the French believe. Therefore, they are interested in only what is written down, only what is on paper.
"This is the explanation for the French love of paperwork.
"I don't say this excuses the perspective, but I hope it will help you to understand why, in this country, the document and the dossier are all that matter." Here's another thing to understand about the French perspective...
- "I have just recently discovered your website and its interesting and exciting information," writes a new reader this month.
"However," she continues, "I have to say that most all the countries you promote outside the EU as safe (this is part of your pitch) are regarded as unsafe to dangerous by different government agencies counseling their citizens about international travel, including Canada, the United States, France, and Switzerland.
"We have young children, and personal security is top on our priority list when it comes to making a move abroad...
"And then this, from another concerned reader, in response to a recent report we published on low-cost medical and dental care in Malaysia.
"Kuala Lumpur has the highest murder rate in the world! I would not go there if the dental work were free..."
Let's take the general safety question first…
- "It's always a good idea to rent first when making a move overseas," writes Asia Correspondent Wendy Justice, "especially in a place like Malaysia, which is so culturally and ethnically diverse. In a place offering so many options, you want to spend time on the ground before making a determination as to the right location for you.
"From the hustle of the capital city of Kuala Lumpur to the laid-back state capitals on the island of Borneo...from the historic charms of Georgetown, Melaka, and Ipoh to the idyllic beach communities of Cherating, Kuantan, Teregganu, and Mersing, each region of this country comes with its own way of life. You should try one or more on for size before thinking about investing in a home of your own in this country.
"The good news is that it's easy for a foreigner to find a rental in Malaysia…"
- Lind Adams of the United States writes this week to ask:
"Kathleen, could you please address some of the possible pitfalls to watch for when attempting retirement to Panama? With all the vast experience and knowledge you and your staff have, I am sure you could offer some good information on things to be cautious about when making such a move...
"Here you are...10 things to understand before you move to Panama..."
ALSO: From Global Real Estate Investing Guru Lief Simon: " Paris is a market that holds its value." That's how Devon de la Salle from the French property agency Imoinvest began her presentation to our Live & Invest in France group this week. Devon's a real estate agent, but that doesn't make her assertion any less true. Even through la crise, as the French call the global financial meltdown we've been living through, Paris apartments, indeed, have held their value. Ask a Frenchman why this is, and he might tell you it's because his countrymen are so stubborn. Not to overstate the situation. There was a decline last year in number of transactions, but this is recovering. The number of sales transactions so far this year is up 76% compared with last. There have been declines in values in sections of the city, as well, but, again, prices are rebounding. Average values across the city are up by 5.3% on an annual basis through April. Why is Paris continuing so stable and strong? Maybe it has something to do with the French temperament, but I'd say it has more to do with the universal and perennial appeal of this city, the most touristed in the world. And, importantly, Paris' ability to ride out the current storm has to do with the French banking system. There's no such thing as "creative financing" here in France. "I worked as a real estate agent for years in California," Devon explained today, "and, boy, did I love creative financing during the heyday of the market in that part of the world. I made a ton of sales thanks to creative financing. But then we all saw the downside to this approach..." The trouble in the Paris market today is lack of inventory. There are definitely more buyers than sellers right now. This means you have to be in the market, ready to make an offer when a property that fits your criteria crosses your radar, especially if your focus is the central arrondissements--that is, the 1st through the 8th. Stephane Adler, our French notaire, who also addressed our group today, confirmed. As in most of the world, there's no Multiple Listing Service in France. However, this country has what's referred to as the " notaire system" for the purchase of real estate. You can't buy a piece of property in France without a notaire, and for every transaction, careful documentation is kept, including particulars such as number of sales and price per square meter arrondissement by arrondissement. In other words, even though you can't do a comps search, you can reference a great deal of information to help you read this market at any time. Notaire data right now shows us just what anecdotal experience and real estate agent speak tells us, as well. This market slowed, and prices fell, slightly. But recovery is well under way. I'd suggest that if you've ever considered investing in a Paris pied-a-terre, this is a moment of opportunity to act, especially if you’re shopping with U.S. dollars. The euro is down sharply against the Greenback, meaning you've got more buying power than you have had in more than a year. Look for an apartment in the heart of the city (again, the 1st through the 8th arrondissements) selling for 300,000 euro, give or take. This budget won't buy you big (perhaps one bedroom), but it will buy you a solid asset that you can look forward to holding its value for you over the very long haul. It’s a straightforward proposition for a foreigner to borrow locally to buy real estate in this country. Longtime friend Tahmiane Madani, Managing Director of France Home Finance, walked attendees at our conference this week through the process and the options.
"Therefore, the French take it as part of the birthright of their Republic that no one and nothing can be taken on sight. Representations can be deceiving, the French believe. Therefore, they are interested in only what is written down, only what is on paper. "This is the explanation for the French love of paperwork. "I don't say this excuses the perspective, but I hope it will help you to understand why, in this country, the document and the dossier are all that matter. "Here's another thing to understand about the French perspective: "Ask a Frenchman any question, and his first answer will be,' Non! It cannot be done!' "On the other hand, ask an American any question, and his immediate response will be,'Yes, of course!' "This is not at all to say that the Frenchman will not help you do what you want to do. It's simply to say that you must interpret any Frenchman's remark, even one as seemingly straightforward as,' Non!' " 'Non' doesn't necessarily mean no. "I lived in the United States and practiced law there for 40 years. I learned that, in the United States, for the Americans, there is black and white, right and wrong, and clear and definite lines and limits as a result. "This is not the case here in France. In France, for the French, there is small white and tiny black. Everything else is gray. "In the United States, if you want, say, to open a bank account, you go to the bank and ask for the list of required documents for opening the account. You provide all the things on the list, and you take for granted that, all items on the list checked off, you'll be given a bank account. "In France, if you go to an official to request details for what is required to, say, obtain a residency visa, again, you'll be presented with a list. However, I assure you that if you work your way through the list, provide every piece of information and document on it, as listed, your chances of getting your residency visa are nearly zero. "In the United States, a list like this amounts to an informal contract of sorts. The one party says to the other,'Provide me with all the things on this list, and I'll grant you the thing you're after.' "In France, on the other hand, a list like this amounts to a suggestion for how you might think about approaching an objective. Every item on it, though, is open to interpretation. "Again, there is very little black or white in this country. It's not a question of what is'legal' or'not legal.' It's a matter of what can be tolerated, and, in practice, most anything can be tolerated..." Kathleen Peddicord P.S. The first day of our Live & Invest in France Conference has been a delightful look at both France and life among the French. As I write, French B&B owners Mel and Nikki Anthony, two Britons who "retired" to France six years ago, are delighting our group with tales of their heart-warming trials and tribulations building what today is a very successful business. "What drew us to France in the first place?" Nikki is remarking as I write. "Very simply, it was the way of life. In the French countryside, life is relaxed, and there's a true appreciation for the joie de vivre. There's also a great respect for family and elders. "Also, France is a very stable place. The property market, the banking industry...all is very nicely stable here. Stable and wonderfully pleasant..." We're getting it all on tape, every single presentation, and, yes, we will be offering a Live & Invest in France Kit,including recordings of all sessions here in Paris this week, plus PowerPoint presentations, and an all-new Live & Invest in France Manual. Watch this space for details. Continue Reading:
My friend, an American, has been living outside the United States with his family for more than 15 years. For most of that time, they've been based in Paris. Several years ago, though, my friend bought a piece of land, with an old hacienda, in Argentina. Since then, he's been trying his hand as a cattle rancher on the pampas. And the idea has grown on him. "We'll continue to return to Paris regularly," he continued, "and we'll keep our apartment here. But, when I think about my retirement years now, I imagine myself on horseback, riding out each morning to check on the herd or maybe to mend some fences. "A friend has also purchased a ranch in the same province of Argentina as ours. I can see us meeting up for long rides and then later, back at the house, for an asado. "I enjoy the way of life down there. Days spent on the land, tinkering with improvements to the property. Evenings spent around the fire. The food, the wine...I've really begun to look forward to it..." Kathleen PeddicordP.S. What else this week?
- "It's not surprising that Malaysia has become a recognized international medical tourism destination," writes Asia Correspondent Wendy Justice. "It boasts some of the least expensive health care in the region. Costs for many treatments are lower even than in neighboring Thailand. The cost of health care in general is so low that many people don't bother with the expense of health insurance.
"Of course, cost is only one part of this important issue. Cheap medical care is no good to you if it's no good. That's not the case in Malaysia, where the quality of care can be of the highest standards.
"Here are some particular examples to give you an idea just how affordable medical care can be in this country..."
- Your retirement nest egg has been marginalized, and you're thinking there's no way you could afford to retire overseas.
This is probably the most-often-given reason for why someone who's interested in the idea of launching a new life in a new country hesitates or even abandons the idea altogether. And it's the least valid.
Here's the truth: You can't afford not to retire overseas.
I'm speaking both literally and figuratively.
Let's begin with my literal point. You could retire toCuenca, Ecuador, for example, and enjoy a comfortable life in a safe, pleasant colonial city on a budget of as little as US$700 per month if you own your own home. If you don't, you could rent a "local-style" apartment for as little as US$200 a month, making your total monthly nut as little as US$900 per month.
- "One week into my recent trip to France and, wham!" writes France Correspondent Jann Seal. "I was on my back with a fever and other disagreeable happenings.
"The flu.
"I dragged myself down to the local pharmacist. In France, they're easy to find. Just look for the green cross on a sign above the door. I found one on a building in the center of town that signaled someone who at least understood sickness was on duty.
"The lady pharmacist seemed to read my expression as I fell through the door. She attempted to diagnose me more specifically by asking questions in French (of course). I was no use. My ability to produce any French in response was lost in my fever..."
- "Can you still find property for US$50,000 or less?"asks Overseas Retirement Letter Editor-in-Chief Lynn Mulvihill in the current issue.
"That was the initial challenge I set for myself for this month's issue. Only I didn't leave it at that...
"Of course you can find a building lot for less than US$50,000. And, if you look, you can find plenty of opportunities for small renovation projects for relatively small change...and closet apartments in fallen-down suburbs across the globe.
"But can a retiree find a comfortable home, in move-in condition, in a part of the world where he might actually want to spend time, for less than US$50,000?
"Those were the criteria for my search for real estate to feature in the property section of this month'sOverseas Retirement Letter (in production now) Iturned up interesting results..."
ALSO From Global Real Estate Investing Guru Lief Simon:The perfectly diversified international real estate investment portfolio might look something like this:
- A rental property in Europe that is leveraged (that is, carries a mortgage...remember that it's possible to borrow for the purchase of real estate as a foreign buyer in many European countries) and that generates positive cash flow. Right now France, Italy, and Portugal make the most sense for this kind of investment. This is a long-haul play, and, thinking very long term, I like Paris.
In Paris this month, I'm reminded that this is the closest thing to a recession-proof rental market as you'll find. France is perennially the world's most touristed destination. This season, thanks to the Greenback's strength against the euro, tourism in is way up throughout the country and especially in Paris. The rues of this city are crowded with camera-toting, guidebook-carrying visitors, many of whom choose short-term rental apartments over hotel accommodation. Our rental manager assures us that, right now, short-term rentals are in greater demand in the French capital than they've been in some time. All markets cycle, including the Paris rental market. But, again, this city is as close to a sure-bet for this kind of investment as exists.
- Next, a rental property in a resort location. Right now, I like the Philippines for this.
- Then, a rental property in another active market. My top recommendations today would be Panama City and Buenos Aires. Neither is as recession-proof as Paris, certainly, but the Panama City rentals market continues to boom (I'm netting 12% per year from my downtown rental) and B.A. is a city that generally always attracts its share of visitors needing a place to lay their heads temporarily.
- Then, raw land. For this, again, I like Panama. Frankly, if your property investment portfolio doesn't include some holding in Panama, you should look to fix that this year. This country's property markets (rentals in Panama City, development lots, and raw coastal land) offer both safe haven and serious upside.
For raw land investments, I also like New Zealand and Honduras.
- Finally, if you can find an opportunity for one, I recommend including in your portfolio a direct investment with a developer. This could be a straight equity investment in a development or what's referred to as a "hard money loan."
Equity is self-explanatory. A hard money loan is when you lend cash to a developer who needs some (don't they all?). Usually, your loan is collateralized by land, and you are promised a return of your capital plus some premium typically great enough to make the undertaking worthwhile from your point of view. A developer might offer you a return of 25%, for example, within a specified period of time, say, 12 months.
This portfolio would give you 6 to 15 properties in perhaps 4 or 5 countries. It'd bring you diversification of market, of currency, of type of holding, and of exit strategy.
And it represents all four strategies I recommend you employ: buying wholesale, path of progress, crisis investing, and real productive assets.
"The lady pharmacist seemed to read my expression as I fell through the door. She attempted to diagnose me more specifically by asking questions in French (of course). I was no use. My ability to produce any French in response was lost in my fever. "She placed a cool hand over my forehead gave me a worried look. "' Grippe,' she said "She gave quick commands to her associate. Instantly, boxes of tablets, syrups, and potions were on the counter for me to examine. "'Do you think I need to go to a hospital?' I asked, more loudly than I intended, hoping, I guess, that the volume would help her understand my English. The Ugly American had reared her head, and I didn't have the strength to send her away. "But the lovely pharmacist simply smiled and brushed the damp hair off my face. " 'Non, pas nécessaire,' she assured me, and, for the first time that day, I began to feel better. "It isn't fun getting sick in another language. Perhaps the worst part is the time that is stolen from your travels. I had no choice but to spend the next few days lying in bed while the whole of the Languedoc-Roussillon départment lay outside my window waiting to be discovered. I'd stare at the river rambling past my window, at the vines on the hills beyond, and at the bottles of green stuff from the white bag that my Florence Nightingale pharmacist had provided for me were, lined up on the bedside table. "I swallowed all the medicines, but, alas, had to forgo the wine I had collected from my pre- grippe trips to nearby vineyards. Those bottles stood like abandoned soldiers on the wooden dining table. And that's where they were left when we finally packed our bags to head back to the airport and home. The next visitor will enjoy them. "I think about the pharmacist in Gabian whenever I open my medicine cabinet. There I see, staring back at me, the remainders of her cures--a few tablets and some green syrup. I've stored them away for next flu season, because they worked miracles. "Out of pocket, my bags of drugs cost the equivalent of US$25. In my memory, the Green Cross, the French lady pharmacist, and the bags of drugs? Priceless." Kathleen Peddicord Continue Reading:
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